An Inconvenient tax: picking people’s pockets

By Raymond Thomas Pronk

Warning, when you check out, be on the lookout for pickpockets.

The latest green movement cause du jour is the banning or taxing of disposable plastic and paper bags. These laws or city ordinances are designed to nudge or coerce customers to bring their own reusable tote bag when they shop for groceries and other merchandise.

A number of United States cities including Washington, D.C., Los Angeles, San Francisco, Portland, Seattle, Boulder, Austin and now unfortunately Dallas have either banned or taxed disposable plastic and/or paper bags or so-called “single-use carryout bags.” According to the Earth Policy Institute, over 20 million people are currently covered by 132 city and county plastic bag bans or fee ordinances in the U.S.

For decades most American and European businesses have provided their customers bags, at no additional charge, to carryout and transport their purchase. In the 1980s businesses began to give their customers a choice of paper or plastic.

On March 26, 2014, the Dallas City Council passed an 8 to 6 City Ordinance No. 29307. It requires business establishments that provide their customers “single-use carryout bags” to register with the city annually each location providing these bags and charge their customers an “environment fee” of 5 cents per bag to promote a “culture of clean” and “to protect the natural environment, the economy and the health of its residences.”

Give me a break. It is a new tax to raise millions in new tax revenue for the City of Dallas. Who are the elected Dallas-8 council member watermelons (green on the outside, red on the inside) that ordained this tax on the people and businesses of Dallas? The names of the Dallas-8 are Tennell Atkins, Carolyn R. Davis, Scott Griggs, Adam Medrano, Dwaine R. Caraway, Sandy Greyson, Philip T. Kingston, and Mayor Mike Rawlings.

The Dallas-8 are led by council member Caraway, who wanted to completely ban plastic and paper single-use carryout bags. Instead they decided to shake down Dallas businesses and their customers with a new highly regressive tax. Caraway refuses to call it a tax and claims the new ordinance which went in effect on January 1 is “a ban with a fee, such as other cities are doing across the United States.”

The eight-page ordinance includes the definition and standards that reusable carryout bags must satisfy: “A reusable carryout bag must meet the minimum reuse testing standard of 100 reuses carrying 16 pound.” Reusable bags may be made of cloth, washable fabric, durable materials, recyclable plastic with a minimum thickness of 4.0 mil or recyclable paper that contains a minimum of 40 percent recycled content.

All of the above reusable bags must have handles with the exception of small bags with a height of less than 14 inches and a width of less than 8 inches.

Business establishments can either provide or sell reusable carryout bags to its customer or to any person.

The city ordinance exempts some bags from the single-use carryout definition including:

Plastic bags used for produce, meats, nuts, grains and other bulk items inside grocery or other retail stores,
Single-use plastic bags used by restaurants to take away prepared food only where necessary to prevent moisture damage from soups, sauces, gravies or dressings,
Recyclable paper bags used by restaurants to take away prepared food,
Recyclable paper bags from pharmacies or veterinarians for prescription drugs,
Laundry, dry cleaning or garment bags,
Biodegradable door-hanger and newspaper bags, and
Bags for trash, yard debris and pet waste.
The Dallas 5 cent paper and plastic bag tax or environment fee applies only to single-use carryout bags defined as bags not meeting the requirements of a reusable bag.

Businesses that violate the ordinance can be fined up to a maximum of $500 per day.

Lee Califf, executive director of the American Progressive Bag Alliance, a bag manufacturing group, said “This legislation applies to a product that is less than 0.5 percent of municipal waste in the United States and typically less than 1 percent of litter in studies conducted across the country;” “Placing a fee on a product with such a minuscule contribution to the waste and litter streams will not help the environment: but it will cost Dallas consumers millions more per year on their grocery bills, while hurting small business and threatening the livelihoods of the 4,500 Texans who work in the plastic bag and recycling industry.”

Stop the shakedown of Dallas businesses and their customers. Repeal the inconvenient tax on paper and plastic disposable bags by voting out of office the Dallas-8 city council members who voted for this tax, Dwaine Caraway. Support your Texas state representatives in passing a new law that would prohibit cities such as Dallas and Austin from banning or taxing paper and plastic carryout bags.

Obamacare sticker shock!

By Raymond Thomas Pronk

While gasoline prices may be going down, premiums, deductibles and co-payments for health insurance plans are skyrocketing.

Beginning Jan.1 all individual and group employer-provided health insurance must comply with the provisions of the Patient Protection and Affordable Care Act, commonly referred to as Obamacare.

More than 156 million Americans have their health insurance plans provided by their employers and another 25 million purchase their health insurance in the individual market, according to the Congressional Budget Office.

More than 60 million people age 65 and older and those younger with disabilities qualify for Medicare, a social insurance program that pays on average less than 50 percent of their health care costs. The balance of their health care costs must be paid for by the individual or the individual’s supplemental insurance.

More than 60 million Americans who are poor qualify for Medicaid, a government insurance program jointly funded by federal and state governments for individuals of all ages whose income and resources are insufficient to pay for health care. Obamacare expanded Medicaid coverage to those earning less than 138 percent of the federal poverty line (about $15,000 for an individual and $32,500 for a family of four). Twenty-four states have opted out of the Medicaid expansion, including Texas.

Those who do not qualify for Medicaid because their earned income is higher than the federal poverty line may qualify for subsidies or credits paid for by taxpayers if they purchase a plan from one of the insurance companies offering them on the new health insurance exchanges.

Most individuals and small-group employers and their employees cannot keep their existing health insurance plans because of Obamacare. They are shocked by the high premiums, deductibles and co-payments of the new plans offered by insurance companies to replace their existing health insurance plans.

Credit: Texas Public Policy Foundation

One reason the premiums and deductibles for non-grandfathered (not in existence on March 23, 2010) individual and small-group employer (employers with 50 or fewer employees) health care insurance plans are significantly increasing is Obamacare requires the insurance companies to offer a minimum core package of items and services referred to as Essential Health Benefits (EHB). The only plans not required to have EHB are fully insured large group plans, self-funded administrative services only plans and grandfathered plans.

These essential health benefits fall into 10 categories: ambulatory patient services, emergency services, hospitalization, laboratory services, maternity and newborn care, mental health services and addiction treatment, rehabilitative services and devices, pediatric services, prescription drugs, preventive and wellness services and chronic disease treatment. These EHBs must be included for plans offered both outside and inside the Health Insurance Marketplace such as those plans you find on the website HealthCare.gov.

A second reason the premiums, deductibles and co-payments for non-grandfathered health insurance plans are increasing is that individuals with pre-existing conditions cannot be denied coverage and the plans cannot have a maximum lifetime limit for medical expenses.

Millions of Americans, because of their age, gender, lifestyle, marital status and religion, do not need maternity care and newborn care, mental health services and addiction treatment, pediatric services, abortions and contraceptives. These Americans were satisfied with and could afford their existing health insurance plans and wanted to keep them.

Americans believed Obama when he repeatedly said, “If you like your doctor, you will be able to keep your doctor, period. If you like your health care plan, you’ll be able to keep your health care plan, period. No one will take it away, no matter what.”

While in theory they could keep their plans under the Section 1251 “grandfather” provision of the Affordable Care Act, the regulations from the Obama administration interpreted this provision so strictly as to prevent most plans from being grandfathered.

Now the American people are learning from various news reports that the Obama administration officials knew in July 2010, when it was published on page 34,522 of the Federal Register, that “The Departments’ mid-range estimate is that 66 percent of small-employer plans and 45 percent of large-employer plans will relinquish their grandfather status by the end of 2013.” This represents about 93 million Americans facing cancellation of their existing plans because of Obamacare.

A sure way for a president to lose the trust of the American people is to misinform them about something they must pay for, such as the premiums, deductibles and co-payments for their health insurance plans.

Obama broke his promise to the American people and as a result his presidential job approval poll numbers have plummeted from an all-time high of 68 percent in Jan. 22-24, 2009 to a recent low of 39 percent on Nov. 5, according to Gallup.

Instead of making health insurance more affordable, Obamacare has made it more expensive for more than 181 million Americans who are now in sticker shock.

Raymond Thomas Pronk presents the Pronk Pops Show on KDUX web radio from 4-5 p.m. Monday thru Thursday and from 3-5 p.m. Friday and authors the companion blog http://www.pronkpops.wordpress.com.

Obamacare: trick, treat or tax?

By Raymond Thomas Pronk

If you think Halloween is scary, you should see the HealthCare.gov website. It is frightening.

When Barack Obama was running for president in 2008, he made a firm pledge to the American people.

“If you who make less than a quarter of a million dollars per year which includes 98 percent of small business owners, you will not see your taxes increase one single dime under my plan — not your payroll taxes, not your income taxes, not your capital gains taxes, nothing. It is time to give the middle class a break. That is what I will do as president of the United States,” Obama said. This was captured in a YouTube video titled “Not a Dime in Tax Increase for Those Earning Less than $250,000.”

Once he was elected, Obama made another promise to the American people.

Obama said, “No matter how we reform healthcare, we will make this promise to the American people; if you like your doctor, you will be able to keep your doctor, period. If you like your healthcare plan, you will be able to keep your healthcare plan, period. No one will take it away, no matter what. My view is that healthcare reform should be guided by a simple principle, fix what is broken and build on what works.” This statement was captured in a YouTube video titled “Obama to AMA keep your doctor and insurance we will build economy.”

On March 23, 2010, Obama signed the Patient Protection and Affordable Care Act, commonly referred to as Obamacare. Before Obamacare was enacted into law, Obama was interviewed by ABC News’ George Stephanopoulos. He asked the president, “You were against the individual mandate during the campaign. Under this mandate the government is forcing people to spend money and fining you if you don’t. How is that not a tax?”

Obama said, “…For us to say that you have to take responsibility to get health insurance is absolutely not a tax increase. What it is saying is that we are not going to have other people carrying your burdens for you.”

Stephanopoulos responded, “I do not think I am making it up. Merriam-Webster’s dictionary, tax, a charge usually of money imposed on persons or property for public purposes.”

Obama replied, “George, the fact you looked it up Merriam’s dictionary, that a definition of tax increase, indicates to me that you are stretching it right now.” The entire exchange was captured in the YouTube video titled “Obamacare : FLASHBACK President Obama said Individual Mandate Is Not a Tax (Sept 20, 2009).”

When Obamacare was enacted, 26 states, along with several individuals and others challenged the constitutionality of Obamacare in the courts. They argued that the law was a violation of the Constitution’s Commerce Clause, which gives the federal government the power to regulate commerce between the states. The Supreme Court ruled that the law could not be upheld under the Commerce Clause. This was the primary argument of the government in arguing for the constitutionality of the law. Chief Justice Roberts, writing for the majority said, “The federal government does not have the power to order people to buy health insurance.”

However, the Supreme Court did accept the government’s tax argument that the individual mandate represented a tax on individuals who choose not the buy health insurance. The Court said, “going without insurance” is “just another thing the government taxes, like buying gasoline or earning income.”

Americans are not required to buy health insurance under the individual mandate, according to the Supreme Court in its ruling. However, if you elect not to buy one of Obamacare’s individual metal (bronze, silver, gold or platinum) plans through a state or federal health insurance exchange, you may be subject to a tax penalty or fine by the Internal Revenue Service.

For 2014, the fine is the greater of 1 percent of income or $95 per adult and $47.50 per child up to $285 per family. For 2015 the fine is the greater of 2 percent of income or $325 per adult and $162.50 per child up to $975 per family. For 2016 the fine is the greater of 2.5 percent of income or $695 per adult and $347.50 per child up to $2,085.

Millions of Americans are now finding out from their insurance companies that as a direct result of the passage of Obamacare, they can no longer keep their existing individual plans or doctors. Instead, they have the choice of either purchasing one of the Obamacare metal health insurance plans with much higher premiums and deductibles or pay the IRS fine.

Thanks to Obama the American people believed their taxes would not rise and they could keep their existing health insurance plans and doctors. Obamacare is not a treat, but a trick or tax.

Raymond Thomas Pronk presents the Pronk Pops Show on KDUX web radio from 4-5 p.m. Monday thru Thursday and from 3-5 p.m. Friday and authors the companion blog http://www.pronkpops.wordpress.com.